Allegrini 2018

China, the collapse of the last quarter of 2018 involves wine. Italy limits damages

A WineNews analysis by Amedeo Scarpa, ICE Pechino director, of the data, in deep red, of Chinese customs
China, the collapse of the last quarter of 2018 involves wine. Italy limits damages

After the first semester of double-figure growth, and the last quarter of “deep red”, the import of Chinese wine closes 2018 in negative territory, marking an unexpected slowdown, which affects all major exporting countries, with the sole exception of Chile.
Italy, according to Chinese customs data published by China Customs and analysed by the Beijing Ice, shows a fall of -3.53%, for an equivalent value of 155.67 million dollars, a significant drop, especially if you consider that in the first six months of the year the wine country had grown by +25.45%, scoring the second-best result behind Australia (+39.68%), which is in decline as Italy (-3.51%). Positive, despite in a critical context, there is the overtaking on Spain, whose decline had already begun, even, in the third quarter, so that in the end the drop was -20.13%, the worst figure. France is also bad, at -8.75%, with average prices close to those of Italian wine, while, as mentioned, Chile is the only major exporter of wine in China to limit the damage and close 2018 in growth, + 4.5%, after a first half closed at + 22.34%.
Understanding the reasons for such a downturn, far from expected, is not easy, but Amedeo Scarpa, director of Ice in Beijing, makes WineNews an in-depth and timely analysis.
“China is experiencing a slowdown in demand, not only for wine but also for middle-class consumption in general, as shown, for example, by the automotive data.
Italy - explains Scarpa - in this context has even managed to contain the damage, with the decline which was mainly concentrated in Spain, Australia and France, while Chile is experiencing a particular situation, with its wines that, for reputation and geographical proximity, have replaced those of the United States, closing 2018 in growth, although limited.
The war of duties with the United States, which broke out in the second half of the year, was the first to be blamed, because “the market, faced with these tensions, is reacting in a schizophrenic manner, and waiting for the consumption boom that usually accompanies the Chinese New Year (5 February) one already breathes a certain optimism after the last round with the United States, which could lead to a suspension of duties”.
On the table there could also be “an excess of unsold stock, a sign that this is a market not still guided by demand, but it is a probability to be analyzed well, because the sentiment among importers, a few months ago, was absolutely positive, they all talked about important improvements, in a few days we will also have their data and their views, which will complete a picture in which - continues Scarpa - the slowdown in the Chinese economy is now universally certified”. What is certain, “is that Italy has reacted better than others, a sign that the path taken, thanks to our campaign of communication and promotion, which will be in recent weeks on all Air China flights and in the cinemas of the country, it’s the right one. We know well the gap that divides us from France, we know their model, but we are building our own - underlines the Ice director of Beijing - and I think that without public and private investments made so far, the situation would be much worse. The question, now, is: apart from this moment, how much new Italy of wine is willing to come to China to expand a still too limited offer?”.

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